Apple shares decline as iPhone sales slump
New devices, which have been well recieved, arrived later than usual
Apple Inc. shares fell as much as 5.6 per cent Friday morning after the company reported iPhone sales that missed Wall Street estimates and said revenue in China slumped.
The company gave no forecast for the key holiday quarter, disappointing some analysts who were hoping for guidance. However, chief executive officer Tim Cook said the new iPhone 12 line has been well received. Sales of Macs and services also reached all-time highs in the fiscal fourth quarter.
The Cupertino, Calif.-based technology giant on Thursday said sales in the three months ending Sept. 26 came in at $64.7 billion. That beat analysts’ estimates of $63.5 billion, according to data compiled by Bloomberg. Earnings were 73 cents a share, also topping Wall Street expectations.
Sales of the iPhone fell 21 per cent on anticipation of the new models, which arrived later than usual this year. Cook said the response to the 5G iPhone lineup and other new devices has been “tremendously positive.”
In Greater China, one of the company’s most important regions, revenue fell 29 per cent to $7.9 billion, the lowest since 2014. Products beyond the iPhone grew double digits in China, Luca Maestri, Apple’s chief financial officer, said in an interview with Bloomberg Television. He expects the iPhone12 Pro Max with its larger screen to do “incredibly well” in the region and that the company is confident about growing there in the December quarter.
The stock, which had gained 57 per cent this year before earnings were released late Thursday, tumbled to a low of $108.85. The company is valued at $1.8 trillion.
“Apple capped off a fiscal year defined by innovation in the face of adversity with a September quarter record, led by alltime records for Mac and Services,” Cook said.
The world’s largest technology company didn’t provide guidance again due to the ongoing impact of COVID-19, with Maestri citing the uncertainty from rising cases in the U.S. and Europe. The holiday quarter is usually Apple’s most important. This year, it includes the release of the iPhone 12 lineup, a new iPad Air, a cheaper HomePod and Macs with Apple’s own processors.
On a conference call with analysts, Apple said the iPhone, other major hardware and services will generate double-digit growth in the current quarter.